|LEI (Legal Entity Identifier) is the international 20-character alpha-numeric code of a legal entity. The LEI-code is unique and attributed to a specific company and the same code cannot be attributed to any other company. The LEI code does not replace code issued by the Commercial Register.
1. Why is a LEI code necessary?
From January 3rd
, 2018 onwards, the LEI code is required for legal entities that perform transactions with financial instruments traded in the European Economic Area trading venue.
Companies that have been awarded the right to provide investment services (for example banks), must report the transactions made with a legal entity`s securities to the supervisory authority using the customer`s LEI code. If the corporate customer does not have a LEI-code, then the reporting obligation cannot be fulfilled and therefore, such legal entities` transaction orders cannot be carried out.
2. Trading which financial instruments requires the LEI code in connection to implementation of MIFID II on January 3rd, 2018?
- financial instruments which are admitted to trading or traded on a trading venue or for which a request for admission to trading has been made;
- financial instruments where the underlying is a financial instrument traded on a trading venue;
- financial instruments where the underlying is an index or a basket composed of financial instruments traded on a trading venue. The obligation shall apply to transactions in financial instruments referred to in points (a) to (c) irrespective of whether or not such transactions are carried out on the trading venue.
3. Who issues the LEI-code?
The LEI-code can be applied for from a separately authorised body and information is available on the Global Legal Entity Identifier Foundation homepage https://www.gleif.org. The corporate customer can choose between all the organisations that issue the LEI- code. Here are a few examples of organisations issuing LEI-s:
We recommend reviewing the terms and conditions of several LEI code issuers to learn more about each organisation`s rules for issuing the LEI code and expected costs. There are no organisations in Latvia that issue the LEI code. As the LEI code is unique, then codes issued abroad, are also valid in Latvia.
The bank cannot order the LEI code on behalf of the customer or mediate the order.
4. Does a fee apply to the LEI code?
The LEI code is issued for a fee and an annual maintenance fee applies. We recommend considering the specific organisation`s rules for issuing the LEI code and associated costs when choosing the issuer. Payment of the annual maintenance fee guarantees the validity of the LEI code.
5. Does the bank have the right to require the LEI code?
The Bank must require all information from a legal entity necessary for submitting information about transactions to the supervisory authority. The LEI code is such information.
As long as no new transactions with financial instruments are performed, the LEI code is unnecessary, but it is required for new transactions starting for 3rd
of January 2018.
6. What happens if the customer does not provide the LEI code or does not have one?
If a corporate customer does not provide all necessary information to perform a securities` transaction, including the LEI code, then it is not possible for the Bank to fulfil the reporting obligation that arises from legislation. In such a case, it will not be possible to carry out such legal entity`s transaction orders (with instruments indicated in chapter 3) from January 3rd, 2018.
The bank will check whether the code exists before accepting a transaction order.
7. How to inform the Bank of a registered LEI code?
To make sure financial transactions can be performed without interruptions, please notify the Bank about your LEI code in advance via e-mail address firstname.lastname@example.org
If you have additional questions regarding adoption of the LEI code, then please contact our Call Centre at +371 67 096 096